Integrated circuits typically incorporate various combinational elements (e.g., AND gates, OR gates, NAND gates, XOR gates, etc.) and state elements (e.g., latches, flip-flops, etc.) in their design. Each of these combinational and state elements are discrete elements that the engineer places into the circuit design.
The silicon wafers used in semiconductor chips have a finite surface area and each element (i.e., combinational and state) etched into these silicon wafers occupies a portion of that surface area. Accordingly, only a finite number of elements can be placed on one of these silicon wafers.